+
CERC Reaffirms Procedure for Recovering Legacy Dues in DSM Pool
ECONOMY & POLICY

CERC Reaffirms Procedure for Recovering Legacy Dues in DSM Pool

The Central Electricity Regulatory Commission (CERC) has reiterated that the approved methodology in the National Load Despatch Centre's (NLDC) detailed procedure applies to all deficits in the Deviation Settlement Mechanism (DSM) Pool Account, starting September 16, 2024.

It has directed distribution companies (DISCOMs) to ensure the timely payment of dues to avoid delays in compensating ancillary service providers and maintaining grid stability.

Notified in August 2024, the regulations outline a process for addressing deficits in the Deviation and Ancillary Service Pool Account (DSM Pool Account) under Regulation 9(7). Following the notification, the NLDC submitted a detailed procedure for recovering dues in two categories:

? Legacy dues: Dues accumulated before September 16, 2024. ? Current dues: Dues accrued on or after September 16, 2024.

CERC approved the procedure to facilitate efficient recovery of dues. However, NLDC reported that some DISCOMs had either not paid or had partially paid their dues. The DISCOMs raised concerns about the fairness of recovering legacy dues, arguing that the procedure did not explicitly mention provisions for such recovery.

The Commission emphasized that the DSM Pool Account is crucial for ensuring payments to ancillary service providers and maintaining grid security. Delays in payments could discourage service providers, potentially affecting grid operations.

CERC referred to its earlier Staff Paper on ‘Grid Security Charge,’ which highlighted the growing deficit in the DSM Pool Account due to high demand and insufficient reserves. The explanatory memorandum to the DSM Regulations also noted a ?4 billion (~$46.2 million) deficit as of March 2024, underscoring the need for a robust recovery framework.

Most available forecasting models provide predictions only in broader hourly intervals, which are insufficient for the precision demanded by the new rules. Additionally, these tools often fail to account for hyper-local weather conditions—especially critical for wind farms, where slight variations in wind speed across small distances can result in significant deviations from the forecasted output.

The Central Electricity Regulatory Commission (CERC) has reiterated that the approved methodology in the National Load Despatch Centre's (NLDC) detailed procedure applies to all deficits in the Deviation Settlement Mechanism (DSM) Pool Account, starting September 16, 2024. It has directed distribution companies (DISCOMs) to ensure the timely payment of dues to avoid delays in compensating ancillary service providers and maintaining grid stability. Notified in August 2024, the regulations outline a process for addressing deficits in the Deviation and Ancillary Service Pool Account (DSM Pool Account) under Regulation 9(7). Following the notification, the NLDC submitted a detailed procedure for recovering dues in two categories: ? Legacy dues: Dues accumulated before September 16, 2024. ? Current dues: Dues accrued on or after September 16, 2024. CERC approved the procedure to facilitate efficient recovery of dues. However, NLDC reported that some DISCOMs had either not paid or had partially paid their dues. The DISCOMs raised concerns about the fairness of recovering legacy dues, arguing that the procedure did not explicitly mention provisions for such recovery. The Commission emphasized that the DSM Pool Account is crucial for ensuring payments to ancillary service providers and maintaining grid security. Delays in payments could discourage service providers, potentially affecting grid operations. CERC referred to its earlier Staff Paper on ‘Grid Security Charge,’ which highlighted the growing deficit in the DSM Pool Account due to high demand and insufficient reserves. The explanatory memorandum to the DSM Regulations also noted a ?4 billion (~$46.2 million) deficit as of March 2024, underscoring the need for a robust recovery framework. Most available forecasting models provide predictions only in broader hourly intervals, which are insufficient for the precision demanded by the new rules. Additionally, these tools often fail to account for hyper-local weather conditions—especially critical for wind farms, where slight variations in wind speed across small distances can result in significant deviations from the forecasted output.

Next Story
Infrastructure Urban

India to Invest Rs 600 Billion to Upgrade 1,000 ITIs

As part of its drive to modernise vocational training, the Ministry of Skill Development and Entrepreneurship (MSDE), in collaboration with Gujarat’s Labour and Employment Department, held a State-Level Workshop at the NAMTECH Campus within IIT-Gandhinagar to discuss the National Scheme for ITI Upgradation.The consultation brought together key stakeholders from industry and the training ecosystem to align expectations and support implementation of the scheme, which aims to transform 1,000 Industrial Training Institutes (ITIs) across India using a hub-and-spoke model. The total outlay stands ..

Next Story
Infrastructure Urban

India Unveils Rs 600 Billion Maritime Finance Push

The Ministry of Ports, Shipping & Waterways (MoPSW) hosted the Maritime Financing Summit 2025 in New Delhi, bringing together over 250 stakeholders including policymakers, industry leaders, global investors, and financial institutions. The summit, held under the ambit of Maritime Amrit Kaal Vision (MAKV) 2047, focused on transforming India into a leading maritime power with strengthened financial, infrastructural, and technological capabilities.Union Minister Sarbananda Sonowal emphasised India's strategic progress, noting that average port turnaround times have dropped from four days to u..

Next Story
Infrastructure Urban

Govt Allocates Rs 500 Million To Boost Community Radio

The Central Government, through its ‘Supporting Community Radio Movement in India’ scheme, has allocated Rs 500 million to strengthen the community radio ecosystem across the country. The initiative aims to assist both newly established and long-operational Community Radio Stations (CRSs), ensuring their relevance to local educational, social, cultural, and developmental needs.According to the policy published by the Ministry of Information and Broadcasting, CRSs may be set up by not-for-profit organisations with at least three years of demonstrated community service. These stations are ex..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?